An assistant attorney general President Obama is considering for labor secretary oversaw a Justice Department section hampered by racially-charged ideological divisions, an inspector general report says.

The long-awaited report, spawned by the New Black Panther Party voter harassment investigation, takes issue with the working atmosphere at the voting rights section that falls under Assistant Attorney General Thomas E. Perez.

The report’s revelations are certain to surface during Mr. Perez’s confirmation process, including information that his testimony to the U.S. Commission on Civil Rights regarding the New Black Panther Party case was incomplete. While the report said investigators did not find that Mr. Perez intentionally misled the commission, he was testifying as a Justice Department witness and should have sought more details from others about the nature and extent of the participation of political employees in the New Black Panther Party decision in advance of his testimony.

The report said Mr. Perez knew whether political appointees were involved in the decision to dismiss the case and told the IG’s office he expected questions about it would arise during his testimony.

“We believe that these facts evidence ‘involvement’ in the decision by political appointees within the ordinary meaning of that word, and that Perez’s acknowledgment, in his statements on behalf of the department, that political appointees were briefed on and could have overruled this decision did not capture the full extent of that involvement,” the report said.

The report also noted that Mr. Perez left out information that Associate Attorney General Tom Perrelli and a deputy associate attorney general were involved in consultations about the decision to drop the New Black Panther case.

“The report makes clear that the division has become a rat’s nest of unacceptable and unprofessional actions, and even outright threats against career attorneys and systemic mismanagement,” Mr. Wolf said Tuesday. “Above all, I believe that Attorney General Holder has failed in his leadership of this Justice Department.

“As the head of the department, he alone bears ultimate responsibility for the serious abuses that occurred on his watch over the last four years,” he said.

The report said polarization within the voting rights section had been exacerbated by the question of whether voting rights laws that were enacted in response to discrimination against blacks and other minorities also should be used to challenge allegedly improper voting practices harming white voters.

Views on this question among many employees within the section were sharply divergent and strongly held, the report said, noting that disputes were ignited when the division’s leadership decided to pursue particular cases or investigations on behalf of white victims, and more recently when division leadership stated that it would focus on “traditional” civil rights cases on behalf of racial or ethnic minorities who have been the historical victims of discrimination.

“We also found that some career employees in the voting section contributed significantly to the atmosphere of polarization and distrust by harassing other career employees due at least in part to their political ideology or for positions taken on particular cases,” Mr. Horowitz said, noting that the behavior included outward hostility, snide and mocking emails, and accessing the attorney’s electronic documents on the voting section shared drive without his permission.

In a written response to the report, Mr. Perez said the Justice Department “takes very seriously” any allegations of harassment, mistreatment, unauthorized disclosure of internal information, and other unprofessional conduct, adding that “a number of troubling incidents” in the inspector general’s report “have no place in the department, and we have taken steps to prevent similar incidents from recurring.”

“We acknowledge, as your report notes, that voting rights enforcement is a particularly important area in which to assure professionalism and impartiality, and we recognize the need to continue taking additional steps to maintain and strengthen the culture of the Voting Section and to foster a work environment that is as collegial and healthy as possible,” said Mr. Perez, who heads the department’s civil rights division.

‘No direct evidence’

The report found “no direct evidence,” such as emails or memoranda, to show laws were enforced in a discriminatory manner or to establish a policy prohibiting cases against black defendants or in support of white victims.

“We found that people on different sides of internal disputes about particular cases in the voting section have been quick to suspect those on the other side of partisan motivations, heightening the sense of polarization in the section,” Mr. Horowitz said. “The cycles of actions and reactions that we found resulted from this mistrust were, in many instances, incompatible with the proper functioning of a component of the department.”

The IG focused on accusations that voting section employees were harassed for participating in specific investigations or prosecutions. There also were questions about what types of cases were being investigated, whether there had been changes in enforcement policies and procedures, and whether civil rights laws were being enforced in a non-discriminatory manner.

The investigation was requested in September 2010 by Mr. Wolf and Rep. Lamar Smith, Texas Republican, who asked the inspector general to examine the enforcement of voting rights laws in the wake of the department’s handling of a civil rights case against members of the New Black Panther Party.

Glenn A. Fine, who preceded Mr. Horowitz as inspector general, could not investigate the Black Panther case since it had been turned over to the Justice Department’s Office of Professional Responsibility, but he said he would examine the overall enforcement of voting rights laws within the civil rights division. That examination culminated in Tuesday’s report.

The office’s investigation of the New Black Panther incident, made public in March 2011, said Justice Department attorneys did not commit professional misconduct or exercise poor judgment in their handling of the case by dismissing three defendants, who were accused in January 2009 of intimidating voters with racial insults, slurs and a nightstick at a Philadelphia polling place.

The Office of Professional Responsibility said it “found no evidence” that the decision to dismiss the case against the New Black Panther Party and two of its members was “predicated on political considerations.”

Section chief review

Tuesday’s report noted that there were “serious discussions among senior leadership in the division and the department about removing Mr. Coates as section chief, at least in part because of a belief that Mr. Coates had a “very conservative view of civil rights law” and wanted to make “reverse-discrimination” cases such a high priority that it would have a negative impact on its ability to do “traditional” cases on behalf of racial and language-minority voters.

But the report said there was no evidence Mr. Coates had declined to implement the decisions or policies of the new administration at the time of this effort, despite his admittedly conservative views and his acknowledged willingness to pursue “reverse-discrimination” cases.

Division leaders also believed, based in part on complaints from career employees, that Mr. Coates was a flawed manager and a divisive figure whose removal would improve the functioning and morale of the section, the report said. Ultimately, it said, Mr. Coates requested and was granted a transfer out of the division.

In a March 2011 report by the U.S. Commission on Civil Rights, which also investigated the New Black Panther Party case, Mr. Coates said that based on his “own personal knowledge of the events surrounding the division’s actions in the Panther case and the atmosphere that existed and continues to exist in the division and in the voting section against fair enforcement of certain federal voting laws,” he did not believe the Justice Department had been truthful in telling the commission about its handling of the New Black Panther Party case.

He also said the Justice Department explanations did not “reflect the hostile atmosphere that existed within the division for a long time against race-neutral enforcement of the Voting Rights Act.” He said the presidential election victory of Barack Obama allowed those most opposed to “race-neutral enforcement” to move into leadership positions at the civil rights division. One of those officials, then-acting Assistant Attorney General Loretta King, ordered the dismissal of the New Black Panther case.

J. Christian Adams, lead prosecutor in the New Black Panther case, testified before the commission that Justice Department officials instructed civil rights division attorneys to ignore cases that involved black defendants and white victims. He said that “over and over and over again” the department showed “hostility” toward those cases.

Mr. Adams, who left the department after the Black Panther case was dismissed, said Justice had “abetted wrongdoing and abandoned law-abiding citizens.”

The inspector general’s report said that many of the career and political employees involved in the most troubling incidents have since left the department and are no longer subject to administrative discipline.

Mr. Coates, a veteran Justice Department section chief who had recommended going forward on the civil complaint against the New Black Panther Party, transferred to the U.S. attorney’s office in South Carolina. New Black Panther Party members had disrupted a Philadelphia polling place in the November 2008 elections, one of whom intimidated would-be voters with a nightstick.

Mr. Smith and Mr. Wolf had raised concerns regarding the dismissal of the civil complaint against the New Black Panther Party, but also sought a review of broader allegations regarding the civil rights division’s enforcement of federal voting rights laws. They focused on “potential improprieties” in the department’s dismissal of the complaint brought against the New Black Panther Party after its members disrupted the Philadelphia polling place.